Your Commissary and Exchange Benefits are in Jeopardy
Recent activities by Congress threaten to eliminate the saving you get when you shop at the Commissary. If passed, these actions could also significantly reduce the money set aside to pay for MWR (Morale, Welfare, and Recreations) activities for military families.
How could this happen? In an environment focused on reducing the deficit, law makers must cut expenses from the budget before agreeing to pay for new programs. Why does this affect the commissary? Unlike other grocery stores, the commissary does not make a profit. By law, commissaries can only charge consumers 5% more than the item costs to stock the shelves. This unique pricing allows military families to save more than 30% on their grocery bill. This works because the costs to operate the commissary is paid by a subsidy in the federal budget.
- Earlier this year, the Senate Veterans’ Affairs Committee voted to eliminate the federal subsidy for military commissaries and recommended the Department of Defense (DoD)consolidate the operations of the commissaries and exchanges in order to pay for the Caring for Camp Lejeune Veterans Act of 2011 (S.277). We strongly believe these families’ health care needs must be met, but we are adamantly opposed to doing so at the expense of other military families. There is still time to act. This bill still needs to be voted on by the entire Senate and then approved by the House, but it poses a very real threat.
- Senator Tom Coburn’s (R-OK) “Back to Black” report also calls for consolidating military commissaries and exchangesinto a single, nonsubsidized retail system over five years.
- There is growing concern that the $1.3 billion subsidy to operate the commissary will be targeted by the Joint Committee on Deficit Reduction or “super committee” tasked to find at least $1.2 trillion in savings over the next decade.
If this bill is passed, prices in the commissary and exchanges will go up in order to make up for the loss of federal funds. You’ve told us how important your commissaries and exchanges are, especially those of you who live overseas or in remote locations, and we’ve shared your thoughts with Congress. You can also tell Congress what you think. Share your story at www.saveourbenefit.com.
If the additional step to consolidate the behind the scenes operations of the commissaries and exchanges takes place, the $300 million earned to pay for MWR programs that support critical quality of life programs could go away. In 2006, after spending $17 million to study the issue, the Department of Defense determined that consolidation was not the answer to budget concerns. It wasn’t the answer then and it is not the answer now.
For more information on the Commissary benefit, we suggest you read Tom Philpott’s article, Commissary boss: Critics overlook the efficiencies. We have also provided a list of important facts on the commissary and exchange.
- Military families currently save an average of 31% by shopping in the Commissary.
- Military families save an average of over 20% by shopping in the Exchanges.
- The commissaries and exchanges pay $800 million to more than 50,000 military family members employed by them.
- Exchanges generate $300 million in dividends which are used to support Morale, Welfare and Recreation (MWR) programs for service members and military families.
- For the $1.5 billion spent annually, commissaries and exchanges generate $5.6 billion in savings.
We urge you to let Congress know how much you value your Commissary and Exchange Benefit! Please leave your comment below.
Thanks for submitting your feedback. If your comment is personal in nature, please email info@MilitaryFamily.org.
Until military families are relieved of the weight of war, we hope you will continue to contribute to their wellbeing.
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